I 



60 th Congress, I HOUSE OF REPRESENTATIVES, j Report 
_ Session. f ] ]S(o. 1168 . 


CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 


March 6, 1908.—Ordered to be printed. 


Mr. Dalzell, from the Committee on Rules, submitted the following 


REPORT. 


[To accompany House Resolution No. 288.1 

On the 20th day of February last Mr. George L. Lilley, a Repre¬ 
sentative from the State of Connecticut, introduced into the House 
a resolution calling for the appointment of a special committee of five 
Members of the House, to be appointed by the Speaker, “to investi¬ 
gate the conduct of the Electric Boat Company of New Jersey and 
their predecessors, the Holland Boat Company, respecting the meth¬ 
ods employed by said companies in connection with passed or pro¬ 
posed legislation before Congress.” 

There was nothing on the face of the resolution that charged cor¬ 
rupt or even improper methods on the part of the company or com¬ 
panies in connection with legislation or proposed legislation. On 
the day succeeding the introduction of the resolution, however, an 
article appeared in the Washington Post which did charge the com¬ 
panies named in the resolution with corrupt practices, and which 
quoted an interview on the subject with Mr. Lilley, the author of 
the resolution. Thereafter numerous alleged interviews with Mr. 
Lilley appeared in certain newspapers of the country coupling the 
names of Members of the House with the Electric Boat Company 
and legislation in its interest. 

Following upon these publications, Mr. Lilley at his own instance 
appeared before the Committee on Rules; admitted the authenticity 
of the intervieAV in the Washington Post, but repudiated all others, 
and made a statement which is submitted herewith as part of this 
report. 

In that statement charges are made of corrupt practices on the 
part of the Electric Boat Company influencing Members and legisla¬ 
tion, and of such character, taken as a whole, as to lead your com¬ 
mittee to conclude that it is due to the maintenance of the dignity 
and integrity of the House and its Members that an investigation 
into the charges made by Mr. Lilley should be had. They therefore 
recommend the adoption of the accompanying resolution. 

^-3514(5 i,r 









2 


CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 

/ V oV 

APPENDIX. ^ 

Committee on Rules, 

House of Representatives, 



Tuesday^ February 26^ 1908. 


The committee met this day at 11 o’clock a. m. Present: Mr. Can¬ 
non, the Speaker, chairman; and Messrs. Dalzell, Sherman, Williams, 
and De Armond. 

The Speaker. Mr. Dalzell, will you ask Mr. Lilley such questions 
as you have in mind ? 

Mr. Dalzell. Mr. Lilley, this committee has before it a resolution 
which you introduced, and the substantive parts of which I will read 
[reads] : 


Resolved, That a special committee of live Members of the House be ap¬ 
pointed by the Speaker to investigate the conduct of the Electric Boat Company 
of New Jersey and their predecessors, the Holland Boat Comj)any, respecting 
the methods employed by said companies in connection with past and proposed 
legislation before Congress. 

The rest of the resolution is simply to provide the machinery for 
the committee. 

Now there is nothing in that resolution that charges corrupt or 
even improper methods on the part of the company or companies 
in connection with legislation or proposed legislation. The Commit¬ 
tee on Rules has noticed certain publications in newspapers purport¬ 
ing to come from you; in substance that the activities of said company 
or companies have influenced corrupt action or proposed corrupt 
action of certain Members of the present House in connection with 
legislation. The Committee on Rules, jmu must understand, may not 
act properly without some tangible fact or facts in the premises. 

Now, on behalf of the Committee on Rules, I* ask you this question: 
Have you a statement to make on your responsibility as a Member of 
the House of facts showing or tending to show the corruption by 
said company or companies, or attempted corruption, of any particu¬ 
lar Member or Members of the present House in his or their legis¬ 
lative capacity ? And if so, what Member or Members ? 


STATEMENT OF HON. GEORGE L. LILLEY, A REPRESENTATIVE OF 

CONNECTICUT. 


Mr. Lilley. I have a statement prepared here that I should like to 
read to the committee. 

Mr. Dalzell. Yes, if it is in answer to that question. 

Mr. Lilley. I think it is [reads] : 

I propose to show that for several years prior to the Lessler inyestigation the 
Holland Company, and its successor, the Electric Boat Company, inaintained in 
Washington an organized lobby for the purpose of intlnencing legislative ap¬ 
propriations in favor of the Holland boat, and that it had under animal retainer 
C. E. Creecy, Gen. Eppa Hnnton, ex-United States Senator M. C. Butler, C. S. 
McNeir, Dr. W. R. Kerr, and others. 

That for several years Mr. Elihn B. Frost, vice-president of the said company, 
has been a continuous visitor at Washington during Congressional sessions, and 
that he has spent large sums of money in furnishing entertainment to Members 
of Congress, and that his expenditures along this line amount to thousands of 
dollars. 

That the Senate amendment to the appropriation bill of March 2, 1907, was 
prepared and drafted by the attorney for the Electric Boat Company, for the 
purpose of and with the intention to eliminate competition in submarine con¬ 
struction, and to prevent the Secretary of the Navy from exercising any dis¬ 
cretion in awarding contracts for submarines. 


HlAR 14- If ; 

01 £), 



"X 


^ CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 3 

(^, ^Ir. Dalzell. AA hat is that clause, please ? Please read that over 
^ again. 

Mr. Lilley [reads] : 

That the Senate amendment to tlie apia-opriation bill of March 2, 1907, was 
piepaied and drafted by the attorney for the Electric Boat Company, for the 
pill pose of and with the intention to eliminate competition in submarine coii- 
stiuction, and to prevent the Secretary of the Navy from exercising any dis¬ 
cretion in awarding contracts for submarines. 

Further [reads] : 

That a thorough investigation by an impartial committee will show that 
large sums of money have been, by the Electric Boat Company, its officers, or 
agents, contributed to campaign funds of Members of Congress who favor and 
have favored the Electric Boat Company’s monopoly of submarine construction; 
also, that large sums of money have been spent to accomplish the defeat of 
members of the Naval Committee who did not favor the Electric Boat Com¬ 
pany. 

Mr. WiLLTA^MS. If it will not interrupt you, will you mind stating 
who those members are? 

Mr. Lilley. I do mind, sir [reads] : 

That an examination of the books and records of the Electric Boat Company, 
and of its predecessor, the Holland Boat Company, will show that large sums 
of money have been paid from their treasuries for the above purpose. 

That continued and repeated efforts have been made by representatives of 
the Electric Boat Company and its predecessor to influence the action of the 
officials of the Navy Department, and that such efforts in the past were so 
persistent and notorious as to call forth the <M)ndemnation and criticism of 
high officials of the Navy Department, whose testimony can be secured by an 
investigation committee. 

That from 1S93 up to the present time these efforts of the Electric and 
Holland Company have resulted in absolutely suppressing anj' possibility of 
competition in submarine construction, and securing and awarding of all con¬ 
tracts, either by specific appropriation or by legislative appropriations skill¬ 
fully drawn, to this company without possibility of competition. 

That it can be shown by former investigation before the Naval Committee of 
the House, upon which no reports were made to the House of Representatives 
that the Holland company and the Electric Boat Company have been engaged 
in doubtful and reprehensible efforts to influence Members of Congress and 
officials of the Navy Department in favor of their boats and appropriations 
therefor. 

That it can be shown upon investigation that certain representatives of lead¬ 
ing newspapers have been subsidized and paid by the Electric Boat Company 
for favorable newspaper articles and reports in behalf of the said companies. 

It has never been held that evidence should be taken or submitted in advance 
to warrant Congressional investigation. Such a procedure would be investi¬ 
gation per se by the Committee on Rules. Such an iiiA estigation should be only 
undertaken by a committee specially appointed for that purpose, and before 
which committee witnesses could be examined, books and records produced, 
and all testimony presented. 

If these things are not actually within the pale of the law, they are wrongful 
practices and tend to throw discredit upon the Congress of the United States. 

Mr. Dalzell. Xow, ^Ir. Lillet^, the first thing you suggest there is 
that this company for a number of years has maintained a lobby here. 
Now, are you prepared to say that that lobby has influenced corruptly 
any Member of Congress in his legislative capacit}^? 

Mr. Lti.ley. I expect to prove wrongful methods. 

Mr. Dalzell. AYhat Members? 

Mr. Lilley. I do not care to state the names of the Members this 
morning. 

Mr. I)alzell. Then you allege also that this company spent money 
for the purpose of electing Members of Congress. Of course you 


I 






4 


CHAKGES AGAINST MEMBERSHIP OF THE HOUSE. 


must have some particular Members of Congress in mind. AVlio are 
they ? 

Mr. Lilley. I do not care to give the names this morning of Mem¬ 
bers of Congress. I do not think it should be expected of me. 

Mr. Dalzell. Then you suggest also that this company has spent 
money for the purpose of defeating Members of Congress. You 
must have some particular Members of Congress in view when you 
make that statement. Who are they ? 

Mr. Lilley. I expect to prove that that has actually been tried. 

Mr. Dalzell. You do not propose to tell us who they ai^e? 

Mr. Lilley. I understand I am not called upon to try the case be¬ 
fore this committee. 

Mr. Dalzell. Well, of course, you know the Committee on Rules 
can not report in favor of a resolution in favor of an investigation on 
some vague statements as to the existence of facts upon which one 
man may draw one inference and another man another inference. 

Mr. Lilley. These are not vague statements. They have been con¬ 
stantly and continuously in the air for about fifteen years. 

Mr. Dalzell. They are vague statements so long as you refuse to 
indicate who the particular parties are who have been influenced. 

Mr. Lilley. I shall be very glad to indicate as soon as this resolu¬ 
tion is passed and the committee named. 

Mr. Dalzell: You say that this lobby has been maintained here 
since 1893, if I recollect rightly your statement? 

Mr. Lilley: Yes, sir. 

Mr. Dalzell : 'When did you come to Congress ? 

Mr. Lilley: In 1903. 

Mr. Dalzell : So that your charges relate back to ten years prior 
to your coming to Congress? 

Mr. Lilley : Yes, sir. 

Mr. Dalzell: Those charges, of course, tmu can not make on tmur 
own personal knowledge ? 

Mr. Lilley : I do not suppose there is an intelligent citizen who 
reads the papers in the "Lnited States who does not know about the 
methods that were being pursued here before I ever came to Congress. 

Mr. Dalzell. I was going to ask you on what information do you 
base your charge covering ten years before you could have had any 
personal knowledge? 

Mr. Lili^ey. On what I had read of this company in the newspa¬ 
pers and what I know from Members serving on thkt committee be¬ 
fore I came here; certain particular Members. 

Mr. Dalzell. Which particular Members do you refer to now ? 

Mr. Lilley. I do not care to indicate at this time. 

Mr. Dalzell. Then that part of your charge is based on newspaper' 
information ? 

Mr. Lilley. No, sir; not altogether. 

Mr. Dalzell. Partly newspapers and partly what you know from 
Members of Congress? 

Mr. Lilley. The Lessler episode occurred before I came to Con¬ 
gress. 

Mr. Dalzell. Do you say what you know of Members of Congress 
before you came to Congress, or from Members of Congress? 

Mr. Lilley. From Members of Congress. 


CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 


5 


Mr. Dalzell. From whom, for instance? 

Mr. Lilley. I do not think I am called upon to give that. 

Mr. Dalzell. Were they members of the Naval Committee? 

Mr. Lilley. Yes, sir. 

Mr. Dalzell. Of what Congress? 

Mr. Lilley. The Congresses prior to the time I came here. 

Mr. Dalzell. From 1893 down? 

Mr. Lilley. Not all of them. 

Mr. Dalzell. Well, the result of the whole business is that you 
will not disclose to us the names of any parties whom you allege have 
been corruptly influenced. Will you give us the names of the parties, 
the individual men, who have attempted to corruptly influence Mem¬ 
bers of Congress? 

Mr. Lilley. I shall be very glad to go into this matter just as soon 
as this resolution is passed and the committee is appointed; and I 
assure you, gentlemen, that I am not talking on hearsay. I know 
my grounds, and I know that I can prove these things before a com¬ 
mittee that means business. 

The Speaker. Let me ask him right there: I just want to suggest 
a question: Do you allege corrupt action against Members of the 
present Congress? 

Mr. Lilley. I allege just what my document says. If these be 
corrupt practices, I allege those things that I have mentioned there. 

The Speaker. Does it apply to Members of the present Congress 
touching business pending before the present Congress, or sluy com¬ 
mittee of the present Congress? 

Mr. Lilley. It does. 

The Speaker. You decline to state whom? 

Mr. Lilley. I decline to state the names of the Members at this 
time. 

Mr. Dalzell. Will you state the names of individuals who have 
corrupted or attempted to corrupt Members of Congress? 

Mr. Lilley. They are using wrongful methods in most every Mem¬ 
ber’s district who serves on the Naval Committee. 

Mr. Dalzell. Can you give us the names of some ? 

Mr. Lilley. I do not care to at this time. They will be called after 
this committee is appointed and we get a chance to operate. 

Mr. Dalzell. In what way did they ever attempt to corrupt Mem¬ 
bers of Congress? 

Mr. Lilley. Well, while I do not care to mention the names of 
others I do not object to telling you an incident concerning myself. 

Mr. Dalzell. Very well. 

Mr. Lilley. In the last Congress a large manufacturer from my 
town, an intimate friend, a man who would probably have as much 
influence with me as any man in my State, told me that he had the 
promise of a large order if I would vote for the submarines. At the 
same time there came down here a lawyer in politics who had been a 
member of the State committee and the town committee where I 
lived; was then; who probably had as much to do Avith my being in 
Congress as sliyy man. He came here to Washington and stayed with 
me, and he was certainly employed by the Electric Boat Company. 

Mr. Sherman. Worked for what? 

Mr. Lilley. He was employed by Mr. Frost, vice-president of the 
Electric Boat Company, Avho, he said, was a college classmate of his. 


6 CHAKGES AGAINST MEMBERSHIP OF THE HOUSE. 

and that he was a splendid fellow and wanted me to meet him. He 
told me about the excellent qualities of Mr. Frost, and urged me to 
vote for his submarines. 

He first had tried by getting the closest political influence to bear 
upon me that he could, and then a large business enterprise that 
employed thousands of hands. The same identical thing happened a 
very few days before the motion was made in our committee this 
year on submarines. A new manufacturer from the city of Bridgeport 
walked into my room over in the new building and told me that they 
were practically closed down, that they never needed an order so 
badly as they did now, that they had a promise of an order from the 
Holland or Electric Boat Company if he would vote me right on 
this proposition. I said, “ What is the size of your order?” He said, 
“ $20,000.” I asked him what the profit was to them. He said, 
“ About $2,000.” Now,” I said, “ let me see if I understand you cor¬ 
rectly. You are asking me to vote three and one-half million dollars 
of other people’s money, of which I am one of the trustees, for the 
sake of giving you a twenty-thousand-dollar order on Avhich you are- 
going to make $2,000 profit. Is that your proposition?” He sat and 
looked at me a feAv minutes and then said he did not like to have me 
put it that Avay. I repeated it to him, and I said, ‘‘ If that is your 
proposition, I Avould prefer to pay you the $2,000 myself.” That 
ended that interAueAv. But an attorney came doAvn here and stayed 
three or four days—the same one—and the morning that he went 
away he left a letter in my box at the New Willard containing a 
clipping from a Washington paper explaining that the Department 
had sent four submarines to Manila and expected others to follow, and 
urged on me the necessity of voting for a liberal number of sub¬ 
marines. I thought I had that letter here. No, it is up home. 

This Electric Boat Company has been a stench in the nostrils of 
the country for years, and, in my opinion, it has done more to corrupt 
legislation than all the other corporations on earth. I think the 
membership of this House is of the very highest quality, and that they 
are the best men, usually, from the districts from which they come; 
but Avith a flock of 383 here, it Avould be strange if there AA^ere not 
some sheep in it that had the foot-rot or scabies'. I think the disease 
ought to be eradicated before it spreads. I have no motive or animus 
in this at all, except in so far as I Avould like to see the business 
run on business lines and the selection of submarines left to experts, 
and not taken from the hands of the Navy Department and from the 
experts of the NaAw, from men like Chief Constructor Capps, aVIio I 
belicA^e to be the best engineer in the Avorld, and men like Admiral 
Converse, and taken absolutely out of their hands and dictated Avhat 
boats shall be built, Avhat companies shall haA^e the contract, leavino* 
them in a position to charge any price they choose. We have got tS 

buy under the present bill that has passed the Naval Committee_ 

Ave have got to buy obsolescent Holland boats and no other at what¬ 
ever price they choose to charge. We have eliminated any chance to 
do business on business lines. 

Mr. Dalzell. What other company is there,-Mr. Lilley? 

Mr. Lilley. There are several, I understand. 

Mr. Dalzell. Do I understand you to charge, Mr. Lilley, under the 
term of “ corrupt practices,” that money has been spent, paid to Mem¬ 
bers of Congress to influence their vote? 


CHAEGES AGAINST MEMBEKSHIP OF THE HOUSE. 7 

Mr. Lilley. I do not claim that any money has been paid to bribe 
a Member of Congress. I do expect to prove that money has been 
contributed to campaign funds, which, morally, is no difl'erent from 
passing a bribe across a table in the committee room when we pass 
a vote. Morally, there is not a particle of difference, legally, there is. 

Mr. Williams. Now, Mr. Chairman, I would like to ask Mr. Lilley 
this question: Mr. Lilley, in case the committee concluded to report 
this resolution favorably would you object to adding this language 
to it?- 

And shall report upon the truth or falsity of the allegations in this resolu¬ 
tion, and, shall recommend to the House appropriate action to be taken by the 
House with regard to Members found guilty of corrupt practices, if any are 
shown to be thus guilty, or with regard to the mover of this resolution in case 
allegations herein contained against the honor and integrity of the House, 
Members of the House, and the House Committee on Naval Affiairs are un¬ 
founded and unsustained by proof. 

Mr. Lilley. If you will submit that to me in Avriting I would like 
to think it over. 

Mr. Williams. It is in writing. 

Mr. Lilley. I do not just know what that means. If you will 
give me a copy of it I will be glad to consider its meaning. 

The Speaker. I would like to ask you a question, Mr. Lilley: You 
introduced the resolution, it seems—this resolution [indicating] ? 

Mr. Lilley. Yes, sir. 

The Speaker. That Avas introduced on a Thursday, Avas it not? 

Mr. Lilley. Yes, sir. 

The Speaker. Your first call upon me touching this resolution, the 
first conversation we had about it, Avas on Saturday last, Avas it not? 

Mr. Lilley. I think so. 

The Speaker. In the meantime you proceeded to be intervieAved 
in the public press? 

Mr. Lilley. Well, Mr. Speaker, I had not introduced that resolu¬ 
tion very many minutes, and I introduced it just about as the gavel 
sounded on Thursday, before the newspaper correspondents were 
around me like a hive of bees. I did not intend to give any inter- 
vieAvs whatever, but finally I said, “ I will dictate an interview to 
one of you gentlemen, proAuded he will submit it to me after he has 
typeAvritten it and ”- 

The Speaker. I am not speaking of that- 

Mr. Lilley. I did dictate an interview to Mr. Smith, of the Wash¬ 
ington Post, and he submitted it to me at the New Willard that 
evening, and copies of that were given to other corr.espondents. 

The Speaker. This intervieAv, the substance of which is restated 
in the first statement alleging corrupt action on the part of the Mem¬ 
bers of the present House, or Avhich purports to have been given out 
by you previous to your appearance before the committee, or any 
oiler to appear before the committee- 

Mr. Lilley. If you had the particular intervicAv Avhich you have in 
mind more clearly identified I might answer. Some intervieAvs have 
been Avritten which were absolutely Avithout the slightest foundation. 
I have given no interAuew except from m3" OAvn dictation and correc¬ 
tion afterAvards when presented to me in typewriting. An interview 
did appear connecting the names of several gentlemen, Avho I believe 






8 


CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 


to be men of the strictest integrity; but that was an absolute fabri¬ 
cation. . . 

The Speaker. I am not referring to any particular interview. 1 
was merely desiring to see as to the fact, whether after you introduced 
this resolution, which upon itf face is harmless—whether it is true 
that you then Avent into the neAvspapers by interview on your own 
motion or by suggestion* on Thursday and Friday. 

Mr. Lilley. I had one interview on Thursday night, and none on 
Friday; and, Mr. Speaker, I tried to get hold of you on several oc¬ 
casions. 

The Speaker. You did not “ try ” to me. 

Mr. Lilley. Yes, before I finally did see you on Saturday. 

The Speaker. This room is ahvays open. You came to see me Sat¬ 
urday afternoon, did you not? 

Mr. Lilley. I came to see you Saturday. I could not say whether 
it was Saturday morning or afternoon. On two or three different 
occasions I had hoped to get your ear, but found you busily occupied, 
and I thought I could wait. 

The Speaker. You did wait until Saturday afternoon. 

Mr. Lilley. I did not get to you until Saturday afternoon, or 
sometime Saturday. 

The Speaker. My recollection is that it Avas Saturday afternoon 
that you came to talk with me about this resolution. I am ahvays in 
this room, saA^e Avhen I am in the House, substantially. 

Mr. Lilley. Well, Mr. Speaker, I have tried many times to get 
your ear, but I have found so many people on the same mission that 
I haA^e been timid about coming in here. 

The Speaker. That was a matter that existed in your own mind. 

The Speaker. Well, Mr. Lilley, neither by writing or coming to 
me have you ever been turned down ? 

Mr. Lilley. No, no; never. 

Mr. Sheraian. Your attention has been called to the alleged inter¬ 
view in the New York Sun of Saturday, February 22, has it not, Mr. 
Lilley? 

Mr. Lilley. Yes. 

Mr. Sheraian. And in the headlines it says, “ Lilley accuses Sher¬ 
man, of New York, of being in on the graft.” 

Mr. Lilley. I did not say that. 

Mr. Sheraian. In my presence did you not tell the man supposed 
to have Avritten that article that it was a lie, characterized by certain 
adjectives before the AAmrd “ lie?” 

Mr. Lilley. I.certainly did; and I told him the same thing as re¬ 
gards Mr. Williams and Mr. De Armond. It is almost too absurd 
to require contradiction. 

Mr. De Araioxd. And it referred also to Mr. Grig-^s? 

Mr. Lilley. Yes. 

Mr. Dalzell. I Avant you to look at that Post and say Avhether that 
is the intervieAY that you are Avilling to be responsible for [submittino- 
copy of the Washington Post]. 

Mr. Lilley [after examining same]. Yes. 

Mr. Dalzell. That is the Post of AAdiat date? 

Mr. Lillea". Friday, February 21. 

Mr. Dalzell. All right. 


CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 9 

Mr. LilleY. I can tell you, Mr. Speaker, what I said about that. 
It was to the effect that the Electric Boat Company had told the peo¬ 
ple who were striving to make that committee, that they had influ¬ 
ence. I do not think there is any objection to my stating the name of 
one of the present Members who went on this year, but I would like 
to ask him. One of the Members that went on this year said that 
representatives of the Electric Boat Company came to him and said 
they had influence and could get him on the committee, and the man 
did get on the committee, although he told them at the time they 
said this to him that he did not care for any of their help. He is not 
one of the Members that voted for the motion, either. 

The Speaker. To what Member do you refer ? 

Mr. Lilley. I would like to ask the Member if he would object. 

The Speaker. You say that one of the Members that went on the 
committee this year told you that- 

Mr. Lilley. Told me that one ^f the representatives of the Electric 
Boat Company came to him and told him he would like to help him, 
but he declined any of their assistance. 

The Speaker. You do not care to state his name? 

.Mr. Lilley. I do not think he would have any objection, but I 
should prefer to ask him. 

The Speaker. Is that all, gentlemen? Is there anything else you 
want to ask Mr. Lilley ? 

Mr. Sherman. There is only one authentic interview, Mr. Lilley, 
and that is the one you have identified in the Washington Post of 
last Friday? 

Mr. Lilley. Yes, sir. 

Mr. Sherman. Every other interview, or purported interview, 
was spurious? You have given no other interview save that one 
which you have identified? 

Mr. Lilley. There might have been two or three lines yesterday in 
regard to the Lord and Early matter. 

Mr. Dalzell. You know the New York Sun interview? 

Mr. Lilley. Last Saturday? 

Mr. Dalzell. Yes. 

Mr. Sherman. He has already repudiated that. 

Mr. Lili<ey. Absolutely. 

Mr. Dai, ZELL. He denies, I understand, every interview except the 
Post interview? 

Mr. Sherman. Up to yesterday? 

Mr. Dalzell. Yes. 

Mr. Lilley. Yes. There were perhaps six or eight or ten lines 
of a statement that I made yesterday in regard to members of the 
press; Lord and Eearly, and others. 

Mr. Dalzell. This is in the Lord interview: 

“Were they all Republicans?” Mr. Lilley \Yas asked. “Not by a long shot,” 
he replied. “Every Democrat except two has been a friend of this company 
in season and out, and it has just as many friends among the Republicans. In 
fact, they are nothing more than so many traveling salesmen, and they know it.” 

Mr^ Lili-ey. That is not my interview. 

Mr. Sherman. You made no statement such as that Mr. Dalzell 

has read? . • i i 

Mr. Lilley. No. The only one authentic interview—the others 

have been garbled- 




10 CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 

Mr. Sherman. Or made out of the whole cloth? 

Mr. Lilley. Yes, or made out of the whole cloth. 

The Speaker. Is there anything else you would like to ask Mr. 

Lilley ? . a 

Mr. Sherman. I would like to ask another question. As a matter 
of fact, you do not accuse me, Mr. Lilley, of “ being in on the graft, 

do you? . . 

Mr. Lilley. I do not, sir. You can put that question in ail the 
forms you want and submit it to me in writing or not, and I will 
make the same answer. You know very well I would not make any 
such statement as that; neither would I make it against Mr. De 
Armond or Mr. Williams or Mr. Griggs. 

If I may have a copy of that I will be obliged to you. 


[Article published in Washington Post, Fridat, Februarj’ 21, 1908, referred to by Mr. 

Lilley in his statement.] 

Suhmarine Lodhy—Representative Lilley aceitses Electric Boat Company 
Calls for investigation — 'Concern's representatives said to have influenced 
committee—Cutting d-oicn of battle ships from four to tu'o and substitution 
of torpedo craft alleged to have been brought about by activity of company's 
agents — Lilley's resolution introdueed after talk with, President. 

m 

Following upon the action of the House Committee on Naval Affairs in recom¬ 
mending the construction of eight submarine torpedo boats of the Holland 
type, Representative lalley, of Connecticut, a member of that committee, yes¬ 
terday introduced in the House a resolution providing for the appointment of a 
special committee to investigate the methods of the Electric P>oat Company, of 
New Jersey, and its predecessor, the Holland Boat Company, in securing legisla¬ 
tion. 

Mr. Lilley declared that undue influence had been brought to bear upon 
members of the committee, including contributions by the company to individual 
and party campaign funds, and that he was prepared to substaniate his charges 
before the Committee on Rules, to which his resolution was referred, or before 
an investigating committee, should one be appointed. 

The resolution was introduced by him after a conference with the President 
at the White House earlier in the day. It is understood that no conclusion was 
reached at this meeting, except that it was agreed that Mr. Lilley should at¬ 
tack the position taken by the majority of the members of the Naval Affairs 
Committee and defend the recommendation of the Administration. The sensa¬ 
tion which the resolution produced among INIr. Talley’s colleagues, both in the 
committee and the House generally, caused them to stand aliout in groups and 
discuss it. The author of the resolution said the Committee on Rules, of which 
the Speaker is chairman, would meet soon and decide whether to recommend 
an investigation. 

TEXT OF THE RESOLUTION. 

The resolution introduced by Lilley is as follows: 

“ Resolved, That a committee of flve Members of the House be appointed by 
the Speaker to investigate the conduct of the Electric Boat Company, of New 
Jersey, and their predecessors, the Holland Boat Company, respectingThe meth¬ 
ods employed liy said companies in connection with past and proposed legisla¬ 
tion before Congress; Provided, That said committee shall have the power to 
send for persons and papers, to examine witnesses under oath, and may employ 
a stenographer and'one clerk, and shall report the result of its investigations 
to the House with such recommendations as it may deem proper: Provided 
further. The expenses incurred hereunder shall be paid out of the contingent 
fund of the House on vouchers approved by the chairman.” * 

The proposal of a Congressional investigation is an outgrowth of the refusal 
of the Naval Affairs Committee to follow the President’s naval construction 
programme. The President personally backed the Navy Department in its 
request for authorization of the construction of 4 battle ships, 10 torpedo-boat 



CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 


11 


destroyers, 4 submarines, etc. The committee cut the battle ships to 2 and 
raised the submarines to 8, and in connection with the latter craft adopted the 
T.iOudensla. 2 :er amendment, providing that they should be of the type of the 
OcUrpus, unless a sui)erior type should be offered and demonstrated by October 
3, 1908. 


THE CONTRACT PROVISION. 

It was at once pointed out by the friends of the President’s programme, among 
them Representative Hobson, of Alabama, and Mr. Talley, that this provision 
practically delivered the contract to the Electric Boat Company, builders of the 
Octopus, because eigliteen months is the time required to build a submarine, and 
the time limit of October 1 gave only eight months to build a competitive craft. 
Another effect of the amendment was to nullify the right gained by the Secretary 
of the Navy, in a court decision growing out of last year’s submarine tests off 
Newj)ort, to consider the lake type of boat as a competitor. 

“ Enough has come under my observation to know that an investigation into 
the methods of the Electric Boat Company of New .Tersey, formerly the Holland 
Company,” said Mr. Lilley, in explaining his resolution, “to convince me that 
a tliorough and searching investigation would result in benefit to the country. 
The time has arrived when the power of the President, the Secretary of the 
Navy, and the naval board has been usurped by this conqiany. Tlie naval pro¬ 
gramme has been ignored, and they have instituted a programme of their own.” 

“ What proof have you of this?” was asked. 

“ Well,” he replied, “ I point to the fact that the 4 battle ships recommended 
by the President were cut to 2 by the committee. The ammunition sliif), scout 
cruisers, and a vessel to lay mines and torpedoes were cut out of the bill. The 
Secretary of the Navy’s i)lan for improved submarines was voted down. In¬ 
stead, double the quantity asked for by the Government—8 in number—were 
provided, but they are to be of the old Octopus type. 

“ The Octopus was finished some months prior to the Vermont, which is now 
admitted to be obsolete, owing to the vast im])rovem(‘nts that have taken place 
since she was launched. A iiroposition to build our new battle ships after the 
plans of the Vermont would be just as reasonable and businesslike as to specify 
in the bill that futures submarines should be built after the Octopus type.” 

“ But you speak of the methods of the Holland peoi)le. What are they?” 

ADEPTS IN I.ORBY WORK. 

“ There are no tricks in the way of lobby work and influencing members that 
the Electric Boat Company are not adepts in. Sentiment is worked up in every 
conceivable mnnner. Attorneys have been hired, who have usually been in¬ 
fluential politicians from the home districts of members of the committee. They 
have brought all sorts of pressure to bear on individual members, and even 
candidates have been brought into the field to contest the nomination of mem¬ 
bers who have opposed the company’s policies. They have even gone so far 
as to find out what new Members of the House have ai)plied for positions on the 
Naval Affairs Committee, and they have assumed to have influence in securing 
the assignment of members on that committee. It has also been said that they 
have contributed to individual and party campaign funds. 

“A thorough investigation after the style of the investigations into the in¬ 
surance companies in New York by a man of the Hughes type would throw a 
great deal of light on the subject. The metlnxls I have mentioned and many 
others would l)e brought out in a searching investigation. By specifying the 
Octopus type in the bill competition for an improved boat is out of the 
question.” 

“ Do you favor the Lake type of boat?” was asked. 

“ I do not,” he replied enqihatically. “ Nor do 1 favor any particular type. 
I believe as every right-minded man must believe, that the type should be left 
to the judgment "of naval experts and constructors and the distinguished mem¬ 
bers of the Naval Board, which includes the Bi-esident, the Secretary of the 
Navy, and Chief Constructoi- Capps. It should not be left to men who are inex- 
l)erienced in the building of vessels, who are influenced in favor of a particu¬ 
lar type of submarine boat. I am in favor of a sipiare deal, and my resolution 
aims to bring that about. If the Holland subiuarine boat has merit, why not 
let it stand on its own bottom?” 


12 


CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 


COMPANY ISSUES STATEMENT. 

After the news of the resolution had spread throughout the Capitol, a rep¬ 
resentative of the company attacked by it gave out tlie following statement: 

“ The Secretary of the Navy, in his last annual report, recommended an 
appropriation for submarine boats of the same type as those which were supe¬ 
rior in the Newport trials of last spring, provided a more siitisfactory type 
was not developed. The Committee on Naval Affairs, heeding this recommenda¬ 
tion, made an appropriation for these boats, in practically the language of the 
Secretary’s recommendation, llepresentatives of the Electric Boat Company 
declare that Mr. Lilley supported an appropriation for a large number of these 
boats at last session, but that since that time the I-^ake boat, whose head- 
ipiarters are in Mr. Lilley’s State, failed in the Newjwrt trials, and they assert 
that Mr. Lilley, after having fought unsuccessfully a provision for submarine 
boats, in the language of the Secretary’s recommendation, is now, through a 
resolution of the House containing charges of misconduct, merely attempting 
to nullify the committee’s action, and that this is nil he hopes to do. 

“ In the Naval Committee members are thoroughly familiar with this unend¬ 
ing strife over submarine boats and with the reckless charges instigated by 
losing competitors. The company has no fear of the result of any investigation 
anywhere. This desire to investigate is always manifested after a losing com¬ 
mittee fight.” 

, MR. LILLEY INDIGNANT. 

When Representative Lilley’s attention was called to this statement he be¬ 
came indignant. He dictated the following reply: 

“That statement is merely a subterfuge and wholly misleading. It is along 
the lines of the company’s past attempts to deceive the public. I should be 
entirely satisfied if the bill followed the same language it followed a year ago, 
leaving the matter in the hands of the President, the Secretary of the Navy, and 
the naval board. 

“ I am ready at the earliest moment to vote for the submarine programme as 
laid down by the Administration ; that is, four boats, and the type to be deter¬ 
mined by the experts in naval construction, namely, the naval board, and not 
by the majority of the committee. 1 do not object to a reasonable appropriation 
for submarines, and I do not care what type, but I do object to the Holland 
Company usurping the power of the President and his advisers. 

“ If the company has no fear of an investigation, as it declares in its state¬ 
ment, let us have a thorough one. The fact that Mr, Lake lives in the State 
of Connecticut has no weight with me. I should i)ursue the same course if he 
lived in the Philipinnes. All I ask is that the building of the boats be left with 
experts.” 

now THE MEMBERS VOTED. 

Those on the committee who are understood to have voted against the appro¬ 
priation for the Holland submarines are Representatives Foss, lalley, Olcott, 
Padgett, and Hobson, the last two being Democrats. The other fourteen mem¬ 
bers of the committee, thirteen of whom voted for the aiipropriation, are Rejire- 
sentatives Loudenslager, Butler, Mudd, Roberts, Ijoud, Bates, Thomas, Dawson, 
and Ellis, Republicans, and Meyer, Kitchin, Gregg, Talbott, and Lamar, Dem¬ 
ocrats. Mr. Meyer is understood to have been out of the city when the vote was 
taken. 

Several members of the committee were interviewed in regard to the resolu¬ 
tion introduced by Mr. Lilley. 

When Mr. Roberts, of IMassachusetts, was shown the resolution he said: 

“ In other words, he charges that the Holland Electric Boat Company controls 
the House Committee on Naval Affairs, and forces it to give more submarines 
than the Secretary of the Navy asks for. I believe any intelligent man who is 
acquainted with the facts in the case will laugh at such a charge. There is 
not a man on the Naval Affairs Committee who would not gladly have voted 
for four battle ships asked for, but we decided that conservatism* would In-ing 
the best results in a year such as this, when we are said to be facing a huge 
deficit. I am told that a determined fight is to be made even on the two battle 
ships recommended, and I should not be at all surprised to see the House bill 
give only one battle ship. 


CHARGES AGAINST MEMBERSHIP OF THE HOUSE. 


13 


“ The price of two bnttie ships is about $18,000,000, and for tiie price of one 
ship we can build 27 submarines, or thereabout. So in cutting off $18,000,000 
from the estimates, a majority of the members of the committee considered that 
it would be only fair to increase the number of submarines, the need of which 
is great. 

CHARGE DECLARED RIDICULOUS. 

“ The charge that a combination of submarine men defeated the four battle 
ship plan is ridiculous, from the fact that there were four different submarine 
propositions voted on by the committee, and on each of these the vote was so 
different as to make the talk of a combination foolish. Every man who voted 
in the committee for two battle ships wall gladly vote for four if it is found that 
there is any sentiment, in favor of the four on the floor of the House. I am 
told, however, that Mr. Tawney, of the Appropriations Committee, expects to 
fight a recommendation for any battle ships at all. If the charges made by 
Representative Lilley are specified, I, for one, will be glad to see the matter 
given the widest publicity, but the resolution in its present form is too 
intangible.” 

Other members of the committee expressed themselves as follows; 

Representative Dawson, of Iowa : “ I have nothing to say at this time.” 

Representative Gregg, of Texas: “I do not know what this resolution is 
directed at, and I do not know of any improper methods used by anybody in 
connection with this legislation, or any other legislation for that matter. If 
any improper methods have been employed, they ought to be known by all 
means.” 

Representative Talbott, of Marylandj “ If there is anything wrong or im¬ 
proper, as Mr. Lilley’s resolution would seem to suggest, let it be investigated 
at once. I never heard of anything improper, either regarding this legislation 
or any other.” 

Representative Loudenslager, of New Jersey: “ There will be no objection 

from me, and I do not suppose there will be any from anybody else, to the 
investigation proposed by this resolution. I don’t know anything about it.” 

Representative Bates, of Pennsylvania: “ I have never heard of this resolu¬ 

tion before and do not knoAV anything about it. I understand the clause in 
the naval bill concerning submarines follows the language of the Secretary of 
the Navy in his annual report.” 


O 


n 




t 









. ;. / 

H • .••*»•• 


4a 

l/% 



it 



iW . 



f 


f 



'1 





e? 


i 




J 


i 


/ 


( 


1 


\ 


i 


* 



t 


» 


r 


J 





« 


J 


% 


/ 


.c.*k fife:. 


t 

I 


•4 


\ 

•'4 

• ^ 








« 


l< 





t 



r 











